Consideration of Mortgage Interest and Rent as Recognized Expenses in the Calculation of Supplementary Benefits

Facts

F. is in receipt of a full disability pension from the Disability Insurance (AI) and lives in his own house (family villa) in N. On 13 January 1999, he submitted an application for supplementary benefits. The Valais Cantonal Compensation Fund rejected the application on the grounds that the applicant's determinant income (CHF 56,669) exceeded the expenses to be taken into account (CHF 54,810). F. appealed against this decision, concluding with a request for the payment of a supplementary benefit. The Insurance Court of the Canton of Valais dismissed the appeal.

Considerations

The main disputed issue concerns the amount of mortgage interest to be taken into account as recognized expenses. According to Art. 3b para. 3 let. b SBA, mortgage interest is recognized as an expense up to the amount of the gross yield of the property, which does not necessarily correspond to the tax rental value used by the administration. The Federal Tribunal considers that the tax rental value does not reflect the actual gross yield of the property and that the mortgage interest must be taken into account up to the amount of this gross yield, which must be determined by the administration in collaboration with the tax administration.

Furthermore, the Federal Tribunal confirms that the admissible expense for rent corresponds to the rental value taken into account…